A Single-family house is on sale where I live for 575K and I’m thinking of buying it and renting it out.
Excellent credit
No debt
Low income via self-employment + unemployment checks, soon likely to run out
Current monthly living expenses in the neighborhood of $3K
Is it possible to me to get a home loan for a downpayment?
If so, what might financing it look like?
Unfortunately, this is tough, forget it.
it is actually possible for YOU to buy that house while being unemployed, with an interest rate as low as ~5.5%, it is just a matter of how much rent this house produces, and, of course, how much down payment you put in.
I refinanced last year a townhouse that appraised $720k, $4500 market rent per appraisal, maximum loan amount was $468k, rate 5.49% for 30 yr fixed.
The $468k had little to do with the $720k (value). The value could have been $20m, the lender would only lend $468k because that’s how much the rent would support.
However, there was a max LTV % limiting the loan amount, but the rent was the more restrictive factor.
You won’t get this type of loan from most loan brokers (and forget about going to a bank). You need to use a broker who works with Non-QM lenders. Google “non qm loan”.
If your $575k house rents for $3000/mo, then your loan amount might be $300k… could be slightly more… depending on property taxes, cost of insurance, HOA etc.
Basically, you did not give enough information.
True. There are some investors willing to fund stated income Non-Owner Occupied purchases. The base down payment is 40% but as noted above, expect allowances in the loan amount based on rent potential.
Risky lending, but that sweet 5x percent return is for some well worth it.
Thanks for reading
LbJW
With excellent credit and no debt, you have a good starting point for obtaining a home loan. However, your low income from self-employment and unemployment checks, coupled with the upcoming expiration of your unemployment benefits, may pose challenges in qualifying for a loan.